Korean financial groups project chip-driven growth in 2026

(Yonhap)

South Korea’s five major financial holding groups projected that a record semiconductor supercycle will drive the country’s economic growth this year.

According to first-quarter reports disclosed by the five financial groups on Wednesday, all of them cited semiconductors as a key theme shaping the Korean economy this year.

The five groups are KB, Shinhan, Hana, Woori, and NH Nonghyup financial groups.

KB Financial Group said that exports of semiconductors, government supplementary budgets, and recovering private consumption would drive growth.

It estimated that even if quarterly GDP growth from the second quarter to the fourth quarter were zero percent, annual growth could still reach around 2.5 percent given strong first-quarter performance.

Shinhan Financial Group also noted that strong semiconductor demand, fueled by expanding AI infrastructure investment, would serve as a core driver supporting exports and facility investment. It also expected gradual recovery in domestic demand thanks to fiscal stimulus effects.

All five financial groups agreed that Korea’s current account surplus is likely to exceed last year’s record level, with expectations of a new historical high.

Woori Financial Group projected that the current account surplus would exceed the Bank of Korea’s February forecast of $170 billion, driven mainly by an expanding goods surplus supported by rising semiconductor exports.

NH Nonghyup Financial Group also forecast a significant increase in the surplus compared to last year, led by trade in goods, while Hana Financial Group expected continued growth in customs exports.

However, institutions warned that Korea’s economic growth may not align with public sentiment due to weak construction activity and geopolitical risks, particularly the prolonged conflict in the Middle East.

KB Financial Group cautioned that variables such as concentrated export structures and global trade tensions remain risks. It added that even if Middle East tensions ease in the first half, delayed normalization of energy supply chains could limit growth.

Shinhan Financial Group also highlighted widening industrial polarization, noting that non-semiconductor manufacturing and construction investment remain weak, which could prolong the gap between headline growth and perceived economic conditions.

Regarding monetary policy, KB and Hana both suggested that the BOK is likely to keep interest rates unchanged for now following the appointment of its new governor.

On foreign exchange, KB warned that if oil prices stay above $100 per barrel, the won-dollar exchange rate could temporarily rise to around 1,500 won per dollar. Hana projected that the second-quarter exchange rate would remain volatile in the 1,450-1,520 won range due to sustained inflation and energy price pressures.